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Big risk, rewards await 2022

China sets massive snow sports goal

Engaging China’s massive population is part of the appeal of the 2022 Games.Getty Images

The next Winter Olympics offer a tantalizing but risky proposition for the snow sports industry: up to 300 million new skiing and snowboarding enthusiasts.

 

As part of its plans to host the 2022 Winter Games in Beijing, which in seven days will be the next Winter Olympiad-in-waiting, the Chinese government wants to supercharge its already-growing winter sports scene.

 

If the Chinese are even fractionally successful in hitting their goal of 300 million, it would be a historic sales opportunity. But with the opportunity comes the possibility of overproduction, unsustainable supply chains, rampant counterfeiting and bad manufacturing quality control.

 

“When you start talking 300 million [new consumers], you’re going to take a global industry and almost quintuple it,” said Nick Sargent, president of SnowSports Industries America, the trade group. “So how are we going to create the demand planning, the manufacturing, the inventory and the commerce for all of that product in a country that has no foundation and no infrastructure to support it?”

Sargent has traveled to China several times already, he said in an interview prior to the Pyeongchang Games, to discuss the matter with the Chinese Ministry of Sport and the Chinese Ski Association. Sargent’s group says there are about 60 million snow sports buyers in Europe and North America combined today.

 

“And, then, beyond that, what is China’s commitment to winter sports after the Games?” he said. “We’ve all read the articles about what happens after a lot of Olympics. If you’re going to quintuple the industry in four to five years and then leave it on its head, you’d decimate the global industry.”

 

The International Ski Federation is happy to tackle the opportunity, said marketing director Jürg Capol, currently in Pyeongchang.

 

“We are interested at FIS in having as many skiers and snowboarders as possible,” Capol said.

 

When you start talking 300 million [new consumers], you’re going to take a global industry and almost quintuple it. So how are we going to create the demand planning, the manufacturing, the inventory and the commerce for all of that product in a country that has no foundation and no infrastructure to support it?
Nick Sargent
President, SnowSports Industries America

 

FIS has created a program titled “Get Into Snow Sports,” with the Chinese Ski Association, FIS Academy and the World Academy of Sport as partners.

 

Through online and in-person classes, the program will aim to educate Chinese citizens on the basics and safety of skiing and other snow sports. The idea is to turn people who might experiment with the sports into recurring enthusiasts.

 

“So the target which we have is to get repeaters,” Capol said. “If you don’t have any information, or education, or somebody that shows you how you should do it, you probably won’t have that much fun.”

 

There are an estimated 15.7 million skiers in China today, according to FIS stats. FIS says there are 150 million active skiers, to one degree or another, worldwide.

 

For the industry, it can’t risk simply staying out of the world’s biggest market, Sargent said. Snow sports brands would cede the territory to competitors, or worse, counterfeiters, if they did that.

 

The investment in China is well underway. Investors and the government have built hundreds of ski resorts during the last two decades, Sargent said. They’re not the same thing as an American or European would imagine — most aren’t designed for overnight stays and are meant for beginners. Also, lack of snow is no barrier — some of the resorts feature a kind of plastic bristle that mimics snow for skiing, and others are entirely indoors.

 

Sargent’s basic groundwork includes opening up communication lines between Western suppliers and the Chinese government and ski resorts.

 

“We need to create a road map, and make contacts,” he said. “We need to create the government relationships and, quite frankly, help develop that infrastructure. That’s what we’re focused on. We’re focused on building that bridge for brands to open up commerce in that region, and ensure there’s longevity.”

 

The most important task for the industry, Sargent said, is to be close enough to the Chinese marketplace to develop independent understandings of how close to the 300 million target they’re likely to come. The worst-case scenario would be to manufacture products that have no buyers.

“We have to walk gingerly, to take baby steps to make sure we don’t over-invest and over-engage, and really make sure we’re holding ourselves accountable to a realistic market size,” Sargent said.

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